Punjab presents Rs5.3tr 'zero-tax' budget for fiscal year 2025-26

Senior provincial minister Aurangzeb says no new tax imposed nor has any tax rate been enhanced

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Punjab Finance Minister Mujtaba Shuja ur Rehman delivering budget speech at Punjab Assembly on June 16, 2025. — Screengrab via Geo News
Punjab Finance Minister Mujtaba Shuja ur Rehman delivering budget speech at Punjab Assembly on June 16, 2025. — Screengrab via Geo News
  • Mujtaba terms provincial budget "tax-free and pro-business".
  • Rs1,240b allocated for development programme.
  • Minister says PRA given revenue collection target of Rs340b.

LAHORE:  Punjab Finance Minister Mujtaba Shuja ur Rehman on Monday presented the province's Rs5,335 billion budget for the fiscal year 2025-26.

Speaking on the floor of the Punjab Assembly, the finance minister said that the present present government has allocated a total of Rs1,240 billion for the development programme that is 23% of the budget 2025-26 and is 47% higher than the current FY 2024-25 containing Rs842 billion on this count.

In next FY budget, he said, estimated expenditures under Account-II (Food) have been reduced up to 88% (Rs53.3 billion) while compared with that of current fiscal year, which is clear proof of the best economic planning of the government, and that is why we have managed to overcome internal debts servicing by 94%.

He said that health, education and other sectors under the social sector have always been a top priority of the Pakistan Muslim League-Nawaz (PML-N) government, that is why a hefty grant of Rs494 billion (40% of the ADP) has been earmarked for the social sector.

Giving break-up of the budget in his speech during the assembly session, Mujtaba said that the total revenues collection is estimated at Rs4,890.4 billion, adding that under National Finance Commission (NFC), Punjab will receive Rs4062.2 billion from the federal divisible pool, while provincial receipts (Own Resource Revenue) are estimated at Rs828.2 billion for financial year 2025-26.

Regarding provincial receipts, he mentioned, Punjab Revenue Authority (PRA) has been given a revenue collection target of Rs340 billion for the next fiscal year, Board of Revenue Rs135.5 billion, and Excise Department Rs70 billion.

Terming the provincial budget as "tax-free, progressive and pro-business", Mujtaba added that during the financial year 2025-26, a total of Rs2,706.5 billion would be spent on under heads of provincial government employees' salaries, pension, PFC transfers and service delivery, asserting that these expenditures are reduced by 6%. Similarly, Rs590.2 billion under the head of Current Capital Expenditures is made part of the budget.

He said that Rs764.2 billion fund of provisional PFC Award (Provincial Finance Commission) have been allocated to empower the local governments, while Rs150 billion and Rs 20billion have been allocated as special grants for waste management and municipal corporations, respectively.

As per welfare state vision of Quaid-i-Azam Muhammad Ali Jinnah, he said, the Punjab government has set aside Rs70 billion package to provide social protection to the people.

While maintaining the fiscal management, he mentioned, Rs470 billion EPS under the agreement between the federal government and the IMF, has been incorporated in the budget, adding that the completion of this provincial surplus is subject to the achievement of the FBR (Federal Board of Revenue) revenue target.

Ahead of the assembly session, Punjab Chief Minister Maryam Nawaz approved the provincial budget. 

"Despite a comparatively compressed budget, the ADP [Annual Development Programme] has increased by 47% from 842 bn to 1240 bn while government operational expenses rose only by 3%, even after salary & pension increases," Punjab senior minister Marriyum Aurangzeb said in a X post.

In another X post, Aurangzeb said: "Under Chief Minister Punjab's fearless and reformist leadership, Budget 2025-26 breaks free from outdated traditions."

She said the budget 2025-26 reflected a historic and strategic realignment of priorities with historic and highest development allocation of Rs1,240 billion with total outlay of Rs5,335 billion.

The minister said the provincial budget was "zero tax budget meaning NO NEW TAX has been imposed nor has any tax rate been enhanced with the road map to increase the Punjab Tax net".